" And by the late 1990s, the article continued, the IMF could no longer "pretend that structural adjustment had not been a massive disaster in Africa, Latin America and South Asia." And so in 1999, the WB-IMF met and renamed SAPs the "Poverty Reduction and Growth Facility."
PROS/CONS: The first five pages of this paper was a review of many of the "cons" of SAPs. What are the positives? Writing in the World Bank Research Observer, John Williamson, who created the phrase "Washington Consensus," complains that the term "has been invested with a meaning...significantly different from that which I had intended..." Moreover, Williamson spends the majority of his article not defending the WB or IMF, but arguing that what he meant by "Washington Consensus" was taken out of context. He defended his role in promoting "privatization" in developing countries (a policy that has been disastrous in many instances), saying that former secretary of the U.S. Treasury James Baker had "put it on the international agenda. In sum, his policies at that time were "widely viewed as supportive of development," Williamson stated. They were the right policies at that time, he insists, because the "key to rapid economic development" - according to the prevailing view at that time - was believed to be in the "set of economic policies" that a country pursued, not in its "physical human capital" or in its natural resources.
CONCLUSION: The WB and IMF have, in recent years, admitted that SAPs have not worked, and have even been detrimental in some nations' experiences. That is laudable. But meanwhile, the World Bank has a "Poverty Reduction Strategy" (PRS) program that it explains will help poor countries "improve public actions for poverty reduction and in doing so enhance the effectiveness of both domestic resources and development assistance." To qualify for these millions of dollars in loans, nations such as Bangladesh, must prepare "Poverty Reduction Strategy Papers" (PRSP) every three to five years, and "annual progress reports" betwixt the PRSPs. The Guidelines have no required format, according to the World Bank Web site, but they are asked to have three basic elements: one, the WB wants assurance that "benchmarks" are being met in terms of evaluations of performance; two, recipients must provide an "overview...
And hopefully, the SAPs are now a policy of the past, lessons have been learned, and nations mired in poverty will truly have a chance to pull themselves up by the bootstraps, with a little help from international funding institutions like the WB and IMF.
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